The Declining Trend in Sulfur Dioxide Emissions: Implications for Allowance Prices☆

@article{Ellerman1998TheDT,
  title={The Declining Trend in Sulfur Dioxide Emissions: Implications for Allowance Prices☆},
  author={A. Denny. Ellerman and Juan-Pablo Montero},
  journal={Journal of Environmental Economics and Management},
  year={1998},
  volume={36},
  pages={26-45}
}
  • A. EllermanJ. Montero
  • Published 1 July 1998
  • Environmental Science
  • Journal of Environmental Economics and Management
Abstract In this paper, we find that sulfur dioxide (SO 2 ) emissions by electric utilities declined from 1985 to 1993 for reasons largely unrelated to the emission reduction mandate of Title IV of the 1990 Clean Air Act Amendments. The principal reason appears to be the decline in rail rates for low-sulfur western coal delivered to higher-sulfur coal-fired plants in the Midwest. Consequently, there is less sulfur to be removed to meet the Title IV cap on aggregate SO 2 emissions, and the cost… 
View via Publisher
mit.edu
152 Citations
Highly Influential Citations
14
Background Citations
60
Methods Citations
13
Results Citations
5

Figures and Tables from this paper

152 Citations

The Potential for Cost Savings in the Sulfur Dioxide Allowance Market: Empirical Evidence from Florida

Since the passage of the 1990 Clean Air Act Amendments, researchers have hastened to appraise the new market for sulfur di-oxide (SO2) emission allowances. As the EPA’s program moves into its second…

Low prices in the sulfur dioxide emissions market : The effect of declining emissions and irreversible investments

The low price of allowances has been a frequently noted featured of the implementation of the sulfur dioxide emissions market of the U.S. Acid Rain Program. This paper presents theoretical and…

Sulfur Dioxide Control by Electric Utilities: What Are the Gains from Trade?

Title IV of the 1990 Clean Air Act Amendments (CAAA) established a market for transferable sulfur dioxide (SO2) emission allowances among electric utilities. This market offers firms facing high…

Benefits and Costs from Sulfur Dioxide Trading: A Distributional Analysis

Policy-makers and others interested in environmental justice (EJ) are concerned that poor and minority communities are disproportionately exposed to pollution. Title IV of the 1990 Clean Air Act…

SO 2 Program

Innovation Under the Tradable Sulfur Dioxide Emission Permits Program in the U.S. Electricity Sector

The 1990 U.S. Clean Air Act Amendments (CAAA) instituted a national program in tradable sulfur dioxide (SO2) emission permits, referred to as "emission allowances," in the U.S. electricity sector.…

Economics of Pollution Trading for SO2 and NOx

For years economists have urged policymakers to use market-based approaches such as cap-and-trade programs or emission taxes to control pollution. The SO2 allowance market created by Title IV of the…

The Effects of Trading and Banking in the SO2 Allowance Market

The 1990 Clean Air Act Amendments initiated a dramatic reduction in emissions of sulfur dioxide and nitrogen oxides by electric power plants. This paper provides an evaluation of the environmental…

The 1990 Clean Air Act and the Implicit Price of Sulfur in Coal

Abstract Prior to implementation of the 1990 Clean Air Act Amendments (CAAA), many estimates of the marginal cost of SO2 abatement were provided to guide policy makers. Numerous studies estimated the…

Market Effects of Environmental Regulation: Coal, Railroads, and the 1990 Clean Air Act

Title IV of the 1990 Clean Air Act Amendments introduced a cap-and-trade system for sulfur dioxide emissions from electric power plants in the United States. This paper analyzes the effects of that…
...

References

SHOWING 1-10 OF 19 REFERENCES

The U.S. allowance trading system for sulfur dioxide: An update on market experience

In 1990, the U.S. Congress passed legislation that amended the Clean Air Act to create a new program to mitigate the effects of acid deposition in the U.S. through emission reductions of sulfur…

THE SO2 EMISSIONS TRADING PROGRAM: COST SAVINGS WITHOUT ALLOWANCE TRADES

Title IV of the 1990 amendments to the Clean Air Act initiated a historic experiment in incentive‐based environmental regulation by permitting electric generating facilities to trade allowances for…

The clean air act's sulfur dioxide emissions market: Estimating the costs of regulatory and legislative intervention

Avoiding regulatory gridlock in the acid rain program

One must be careful what one wishes, lest it come true. For over two decades economists have extolled incentive-based regulation as the way to achieve environmental and other social goals at less…

Transaction Costs and Tradeable Permits

Abstract Tradeable-permit systems are at the center of current interest and activity in market-based reforms of environmental policy, because these systems can offer significant advantages over…

Marketable pollution permits with uncertainty and transaction costs

Why are allowance prices so low? : an analysis of the SO2 emissions trading program

Supported by a grant from the National Acidic Precipitation Assessment Program of the US Government, and the Catholic University of Chile.

Seller Incentive Properties of EPA′s Emission Trading Auction

Abstract The new Clean Air Act Amendments instruct the Environmental Protection Agency (EPA) to conduct annual sealed bid/offer auctions of emission allowances. The auction pricing rules are…

Markets in Licenses and Efficient Pollution Control Programs" Journal of Economic Theory

Marketable Permits: Lessons for Theory and Practice

One of the central tenets of industrial organization theory is that the allocation and definition of property rights can have important implications for market performance. When ownership is not…